Kyiv.Ukraine.Ukraine Gate –October 30,2021- The National Bank of Ukraine (NBU) expects inflation to slow to 9.6% at the end of 2021 and then gradually return to the 5% target in 2022.
“Having peaked in September and October, inflation will begin to slow down, reaching 9.6% at the end of 2021. In 2022, it will fall to its target of 5% and will remain close to it in the future, and the real GDP of Ukraine will rise by 3.1%. In 2021. After that, the Ukrainian economy will grow by about 4% annually, the Central Bank wrote in its October 2021 inflation report.
The NBU also kept its inflation forecast for 2021-2023 unchanged. However, tighter monetary conditions will be necessary in the coming years to bring inflation back to 5%.
“Passing this year’s hryvnia boost to consumer prices amid higher crop yields will reverse inflation dynamics in late 2021. This reversal will also be driven by steps previously taken by the NBU, including major increases in interest rates (by 2.5 percentage points since the beginning of the year). year, to 8.5% annually) and roll back emergency measures. These steps have almost offset the stimulus effect of monetary conditions this year, and will ensure the transition to neutral conditions next year.”
According to the NBU, as a result, inflation will slow to 9.6% in December 2021 and return to the NBU’s medium-term target of 5% in late 2022.
The Ministry of Finance expects that inflation will not exceed 10% at the end of 2021.
